Corbett signs bill creating city revitalization zones

Gov. Tom Corbett speaks at the Greater Reading Chamber Center for Business Excellence in April.

Gov. Tom Corbett on Monday signed into law the bill that will give Reading and other Pennsylvania cities a chance to create so-called City Revitalization and Improvement Zones to attract new businesses.

The 130-acre zones will be funded with public bonds issued by a local municipal authority running the zone. The bonds will be repaid by local and state tax revenue raised within the zone.

The law resulted in large part from the work of state Sen. Judy Schwank, a Ruscombmanor Township Democrat, who noted that the original bill sponsored by Sen. Lloyd Smucker, a Lancaster Republican, would have frozen out Reading.

"There are many cities the size of Reading that were not covered under the initial proposal," Schwank said. "I worked to make sure they had the option to participate in a new program that could provide significant economic development and a way out for cities struggling with declining property values, job loss and escalating crime."

Cities will have to compete for the right to set up the zones.

Two cities will be chosen for a pilot program this year, and two more each year can join beginning in 2016. Reading officials have said they will certainly be among the first-year applicants.

Schwank said the new zones got approved because of bipartisan support and the collective belief that the new economic development tool will make a difference.

She said the same law also exempts fire departments and other emergency response companies from paying property transfer taxes when they merge or consolidate.

Schwank said she worked with Rep. Ryan Mackenzie, an Emmaus Republican, on the proposal after the Barto, Bally and Bechtelsville fire companies merged to form the Eastern Berks Fire Department and were slapped with a $17,000 transfer tax bill after deeding their stations to the new company.